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New Michigan Emergency Manager Bill Has Implications for Districts

On Nov. 6, Michigan voters tossed out a 2011 law, Public Act 4, that allowed emergency financial managers for municipalities and school districts to tear up collectively bargained contracts with public employee unions. But the issue of emergency managers' power is far from dead in Michigan, since the voters' rejection of the law didn't mean that emergency managers themselves were eliminated.

The state House of Representatives is set to have a vote of the entire chamber on a new House bill that revives the managers' power over contracts, in a more roundabout way. The House Committee on Local, Intergovernmental, and Regional Affairs committee approved the bill on a party-line vote (with Republicans in favor) early Thursday.

As John Oosting of Michigan Live reported, here is how the proposed emergency manager law would work (I have not located a copy of the bill itself yet, since it was only introduced Thursday):

• An emergency manager is allowed to make changes to a union's contract with a district or municipality, after discussing the contract with the union in question.

• The school board or city council has a week to review the proposed revisions, and then either approve or reject them. If the board or council rejects them, however, they must come up with their own plan that achieves "similar savings," as Oostling puts it.

• If necessary, a local emergency financial assistance loan board—consisting of three officials—would review both sets of revisions, select one, and order the emergency manager to put it in place.

So it appears as if the emergency manager, through his or her power to propose changes to union contracts, would get the ball rolling that ultimately stops not with the school board, but with a emergency financial board. And if school boards have to come up with savings similar to the amount proposed by the emergency managers, it's hard to imagine that they could avoid reworking or eliminating parts of union contracts, since labor costs often account for the vast majority of school districts' operating costs. Either school boards have to swallow what the emergency manager prescribes, it seems, or they have to put something down their own throat that they may not want. And they ultimately don't get to decide which plan goes down the hatch.

The districts may have some wiggle room based on the "similar savings" they must achieve compared to the managers' plan. But Russ Bellant, a public education advocate and activist, says the law brushes aside the will of the voters, and is the first step of a two-step plan to privatize public schools by weakening or destroying public employee unions.

"It retains all the elements of the language that voters voted down," Bellant told me.

Other portions of the proposed law are more friendly to local government and school officials, and appear to be a response to criticisms raised about Public Act 4. For example, local officials could remove an emergency manager after one year by a two-thirds vote of the relevant government body, and the state would pay the salaries of emergency managers.

"We have got something that we feel is good, sound public policy that will very clearly recognize and respect the will of the voters while making sure we also have local control," Sara Wurfel, a spokeswoman for Republican Gov. Rick Snyder, told the Associated Press by way of explaining the new bill, according to Oosting.

When I reached Bellant, by the way, he was at the state capital in Lansing, part of a protest regarding "right to work" laws that are at the top of Snyder's agenda. That proposal will also be closely watched and fiercely fought by the same unions now worried about the ghost of Public Act 4 coming back to life. I wrote a story this week about other sweeping changes to school funding and other parts of Michigan education law.

The emergency manager law has particular relevance for Detroit Public Schools, as my colleague Jaclyn Zubrzycki has documented. The Detroit board of education voted last month to remove the district from emergency management. The school board for Highland Park, also in Michigan, filed suit to get rid of its own emergency manager.

The Detroit school board also complained when DPS was named as a finalist for the Race to the Top district competition, one of 61 such finalists, because of concerns about the Education Achievement Authority, the state-run organization that through the emergency manager was in charge of Detroit schools.

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